The European Union's Commissioner for Enlargement, Gunther Verheugen has expressed deep concern over the situation in Malta on the issue of EU membership.

In an interview with Jesmond Bonello at his office in Charlemagne building in Brussels, Mr Verheugen said he had been hoping that during the pre-accession process, the strong polarisation in Malta on the membership issue would have either disappeared or diminished.

Mr Verheugen said if Malta were to decide to stay out, the island would be truly marginalised.

There are several stumbling blocks left to overcome until the enlargement process comes to an end. First among them is the second Irish referendum on the Nice Treaty, which is a precondition for enlargement. In Malta, there is growing concern that if the Irish would vote 'no' again enlargement would have to be delayed and that this might affect the timing of the referendum and the general election due to take place in Malta next year. What is your opinion?

Yes. I cannot deny that. The concern is absolutely justified. I share that concern because the Irish referendum is very crucial for the success of the enlargement process and for us to keep the timetable to conclude negotiations with the best prepared countries before the end of this year.

The position of the Commission is very clear. We need the ratification of the Treaty of Nice; otherwise it will be very hard to conclude this process.

We do not have alternatives or specific scenarios in our mind in case the second referendum will fail once again as I believe that it would not be wise to do so.

Right now the focus should be on the referendum itself. However, I think that this time the situation in Ireland cannot be compared to the situation last year when the turnout was very low and enlargement did not feature at all in that campaign.

This time, I expect a higher turnout and also enlargement is one of the key elements in the current Irish campaign.

I am reasonably confident that the Irish, who are really enlargement-friendly, will not deny Poland and Malta, for example, access to a system of European integration that was extremely beneficial to the Irish people themselves.

But will a 'no' vote in the second referendum delay enlargement?

I cannot say it will be delayed but I cannot exclude that possibility.

It really depends on whether it will be possible to find a solution to the institutional issues that have to be solved in the context of the accession treaties.

So we need to know the size and composition of the Commission, we need to know how many seats will make up the European Parliament and we need to know about power sharing and voting mechanisms in the Council.

The whole affair is more complex because these are not the only issues which are at stake. You cannot just make an attempt to extract these elements from the Nice Treaty and include them in the accession treaties.

This is a simplistic view because the Treaty of Nice is a well-balanced treaty that has to be seen as a whole and it has other elements besides the institutional aspects.

For some member states, it was very important to include elements of "deepening", meaning more integration of substance, and "widening", that is the institutional provisions for enlargement.

So the situation is difficult and we should do our best to support a positive outcome in Ireland. The best way to do that is not to interfere too much.

We cannot give the Irish the impression that the outside world is telling them what they have to do. You, as a Maltese would certainly understand my point. Your scenario is similar particularly because Malta is also a very small country. If the outer world will try to tell them what to do, the reaction will be negative.

Another scenario is that the new German government will not be fully functional until late October, which effectively squeezes the final "money" negotiations into the last few weeks of the year. Do you think this factor creates another potential argument for delaying the whole process?

No. I honestly don't think that the German elections will create such problems in this respect. The German Constitution is very clear in the sense that the present German government will continue to have full power until a new government is elected.

So there is no interim period in Germany where you would have only a caretaker government. It is a tradition in Germany that if a change of government will take place as a result of the elections, the outgoing government does not take major decisions.

But to be honest it does not matter very much. I do not see fundamental differences between the present government and the opposition in that all parties in the German parliament are fully supportive of enlargement.

I think the time factor is very important but in reality it was agreed that the final decision on the remaining issues - agriculture and financial package - will be taken by the first week of November. That means that everybody has time to prepare his or her position.

To be honest, I do not think that the final EU decision on these issues will be very different to the proposals prepared by the Commission.

I must say that it was extremely useful that the Commission has insisted not to allow the setting aside of difficult political questions to be dealt with in the eleventh hour. We did not allow it and insisted that problems have to be solved according to our timetable. The situation is now very clear.

I do not know whether I have the wrong impression but it seems to me that the Commission's communication strategy in Malta is pretty much dormant. What is the situation?

The problem with the communication strategy in all countries is that, in effect, it did not start until the beginning of this year due to political and technical problems. Perhaps it is a bit early to judge whether it is working or not. My general impression is that we can already see the first positive results. However, we shall be reviewing this process and we should be defining our targets in a more precise way.

I personally feel that the strategy should be more focused on specific targets. I give you an example, which is not related to Malta.

I was recently in Poland where it was evidently clear that agriculture is the number one issue there and I believe that our communication strategy in Poland should be fine-tuned in a way to deal with the situation.

Certainly, we can do the same with Malta. However, I must make it clear that it is not our aim or responsibility to organise any political campaign in any of the candidate countries.

During your visit to Warsaw you were quoted as saying that Poland must face opponents of its bid to join the EU or risk political isolation and economic crisis. As you are well aware, the opposition to membership in Malta is still very strong with the Labour Party commanding more or less the support of half of the population. How do you assess the situation?

I am very concerned with the situation in Malta. I had been hoping that during the pre-accession process, the strong polarisation in Malta on the issue of membership would have either disappeared or diminished.

My impression is that polarisation is now even stronger and the opposition is also saying that it will not respect the result of the referendum. This is a matter of concern for the EU because it creates uncertainty.

We do not know what will happen even after we conclude negotiations with Malta. So in this scenario it is quite possible that we successfully conclude negotiations with Malta but will then encounter political obstacles.

I must say the Maltese government has always been honest about the situation and it never denied the fact that there might be problems.

In this respect, even the leader of the opposition was honest in making it clear that his opposition to membership is absolutely unconditional - total, total opposition - something which, I must say, I have not seen often in my life.

But that is democracy and finally the Maltese will have to decide and their decision will be respected. Democratic decisions are democratic decisions. Full stop.

An assessment of the situation shows that the benefits of EU membership for Malta will outweigh certain problems that might arise because of adjustments which have to be made.

First of all, Europe is changing its political and economic structures significantly to an extent that after enlargement Europe will not be the same and Malta would have to live in a completely different world.

It will not be a good decision for Malta to stay out - Malta will be an outsider in a more or less integrated Europe. I wonder how much Malta - in this globalised world, and without the additional strength that being part of the integrated Europe can provide - will be able to defend its political and economic interests.

I am afraid that in this scenario, Malta will be truly marginalised and a country that cannot guarantee its citizens a very bright future. I do not know another country in Europe where the question of accession is such a controversial political issue.

In my mind, the issue should be very simple and boils down to a fundamental question: do you want to belong to a stronger EU which is facing the challenges of the 21st century or do you want to be "in a nowhere land" between Europe and Africa?

The idea of being a bridge between Europe and Africa is, to say the least, an outdated argument.

On the other hand, as an EU member, Malta can use its geographic proximity and experience with its neighbours in a context of European foreign and security policy. That could be very useful.

Is it a concern that Malta could be the first EU member state to withdraw from the EU in the future if it would have already joined?

Not really. Our concern is related to the coming referendum and general election.

In the latest development, the leader of the opposition said it would be better for Malta to shelve both the government membership bid and the opposition partnership proposal for a number of years to focus on domestic issues. What is your reaction?

Frankly, my analysis of the domestic situation in Malta is that the issue of accession is the only issue for the opposition.

It is now a more or less a single-issue-opposition and it seems that it is building its campaign for the election on this platform.

That does not change the situation and basically we have to wait until the citizens of Malta will decide. It will be an independent decision taken by the Maltese. Nobody intends to interfere.

Of course, everyone in Malta needs to be fully aware of the consequences of the choice they will be making. My advice is for the people of Malta to wait until the package is known, then listen to all the arguments and, at the end of the day, make up your mind.

We accept that there are different opinions in Malta on the issue of membership and we will accept the final verdict of the Maltese citizens. I must stress that this decision should be based on the truth and no one should tell the Maltese that there are beautiful alternatives to membership which, in reality, do not exist.

If the Maltese decide against membership next year, would it be possible to join later with Bulgaria and Romania, let us say by 2010?

The timetable with Bulgaria and Romania is part of this enlargement process. I will not speculate on what Malta will be able to do in such a case.

But it will not be easy for a Maltese government to repeat an exercise which would have already failed twice.

Certainly, this scenario will not happen under my term. My successor - if there will be a Commissioner for Enlargement - will be able to deal with such a situation. From my point of view, I must stress that we want Malta to join the EU: it is important for Malta and it is also important for us. This is our message. The rest is up to the Maltese to decide.

Realistically, when will the accession treaty with Malta be signed and does the EU have a preference on whether the referendum should be held before or after the signing of the treaty?

It is foreseen that the treaty will be signed between the end of March and end of April of next year. We do not interfere when a candidate country should hold the referendum - if it decides to hold one.

(An accession treaty has to be ratified by the 15 member states individually and by Malta to come into effect).

One of the fundamental, yet basic principles of the EU is that it does not discriminate between its members. Yet, tiny Malta is suffering from two blatant cases of discrimination. The first one is related to the allocation of seats in the European Parliament where two countries of similar size were allocated a different number of seats with Malta getting one fewer.

The second issue is related to Malta's demand to retain zero VAT rating on food and medicines for so long as the UK and Ireland retain similar arrangements. In this case, Malta has not asked for any precedent to be made but yet the Commission has found objection. Don't you think this is blatant discrimination?

On the first point, my advice frankly is not to make such a big issue out of it. An MEP for Malta will represent 80,000 citizens - an MEP from Germany will represent 800,000. Who is discriminated? If I were you I would be very careful on this issue.

A Commissioner for Malta will represent 400,000 people. A Commissioner for Germany will represent 82 million. The system that we have adopted favours smaller countries.

The truth is that Malta, as a member state, will be much more influential on the international political scene than it is now because it will be an integral part of the EU decision-making process.

On the issue related to taxation, this is still being negotiated. Malta's argument is that since Ireland and UK still have a permanent derogation, Malta should have the same.

One should look at the context of the situation. For instance, the agreement with the UK had been reached a long time ago under completely different conditions and scenarios.

In this enlargement process and in current negotiations, the Commission made it clear that there will be no permanent derogations. The EU has made only one exception. Only one country has obtained a permanent derogation. Do you know which country?

Which one?

Your country, the arrangement under the free movement of capital chapter dealing with the acquisition of property for secondary residence.

The anti-EU membership lobby in Malta insists the government is giving in to everything. On the other hand, the government says that, in fact, a number of chapters have remained open because it is putting its foot down on certain issues. Who is right?

It is absolutely true that the Maltese are tough negotiators. So far, Malta has not been able to close some chapters because it is still insisting on some specific issues. In fact, Malta has closed 24 chapters when other countries closed 26 to 29 chapters. In my view, this is quite understandable in the sense that it is has to do with the size of Malta.

The technical aspects of negotiations with a bigger state are abstract. In Malta's case, everybody knows how a particular decision could affect his/her own personal life. Then there is also the issue of the opposition to membership.

By the way, I do not have a clear timetable of when the remaining problems will be solved. These problems have been identified and I personally think they are manageable. But we need a strong effort on both sides. However, it is very clear that there are no special rules for Malta and certain flexibility on both sides is needed.

I believe that the environment chapter can be closed in September. A solution is relatively close on a Customs union. And more technical discussions are needed on taxation and competition.

I see strong political will from both sides to solve these problems. Obviously, agriculture and budget are also being dealt with.

I do not see the picture as bad. It is misleading to believe that because Malta has closed only 24 chapters it has fallen behind in negotiations.

Finally, in a nutshell, why should Malta opt for membership?

It is a question of choice between forming part of a changing EU which is becoming an even stronger and global player in the world or whether Malta will be a small island between Europe and Africa with no influence or voice.